Page:United States Statutes at Large Volume 100 Part 3.djvu/981

 PUBLIC LAW 99-514—OCT. 22, 1986

100 STAT. 2789

service and which is used by any foreign person or entity (as defined in section 168(j)(4)(C)) under a qualified lease (as defined in paragraph (7)(C)) entered into before January 1, 1990, shall not be treated as ceasing to be section 38 property by reason of such use until such aircraft has been so used for a period or periods exceeding 3 years in total. "(B) RECAPTURE PERIOD EXTENDED.—For purposes of paragraphs (1) and (5)(B) of this subsection, any period during which there was use described in subparagraph (A) of an aircraft shall be disregarded." (B) Clause (iii) of section 48(a)(5)(B) is hereby repealed. (6) TREATMENT OF CERTAIN PARTNERSHIPS HAVING SECTION 593

ORGANIZATION AS MEMBER.—Paragraph (4) of section 46(e) is amended by adding at the end thereof the following new subparagraph: "(D) SPECIAL RULES FOR PARTNERSHIPS, ETC.—For purposes

of paragraph (1)(A), rules similar to the rules of paragraphs (8) and (9) of section 168(j) shall apply." (7) TREATMENT OF CERTAIN PROPERTY HELD BY PARTNERSHIPS.—

(A) Paragraph (9) of section 168(j) (relating to treatment of property owned by partnerships, etc.) is amended by redesignating subparagraphs (D), (E), and (F) as subparagraphs (E), (F), and (G), respectively, and by inserting after subparagraph (C) the following new subparagraph: "(D) DETERMINATION OF WHETHER PROPERTY USED IN UNRELATED TRADE OR BUSINESS.—For purposes of this subsec-

tion, in the case of any property which is owned by a partnership which has both a tax-exempt entity and a person who is not a tax-exempt entity as partners, the determination of whether such property is used in an unrelated trade or business of such an entity shall be made without regard to section 514." (B) Subparagraph (E) of section 168(j)(9) (as redesignated by subparagraph (A)) is amended by striking out "and (C)" and inserting in lieu thereof "(C), and (D)". (8) EXCEPTION FOR QUALIFIED REHABILITATED BUILDINGS LEASED

TO SECTION 593 ORGANIZATIONS.—Paragraph (4) of section 46(e) (relating to special rules where section 593 organization is lessee) is amended by adding at the end thereof the following new subparagraph: "(E) EXCEPTION FOR QUALIFIED REHABILITATED BUILDINGS

LEASED TO SECTION 593 ORGANIZATIONS.—Subparagraph (A) shall not apply to qualified investment attributable to qualified rehabilitation expenditures for any portion of a building if such portion of the building would not be taxexempt use property (as defined in section 168(j)) if the section 593 organization were a tax-exempt entity (as defined in section 168(j)(4))." (9) CLERICAL AMENDMENTS.—

(A) Paragraph (4) of section 48(a) is amended— (i) by striking out "514(c)" and inserting in lieu thereof "514(b)", and (ii) by striking out "5140))" and inserting in lieu thereof "514(a)". (B) Subclause (I) of section 48(g)(2)(B)(vi) is amended by striking out "section 168(j)(3)" and inserting in lieu thereof "section 168(j)".

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